Ray Dalio sounds Alarm on U.S. Debt, Economic Role

Updated June‍ 21, 2025
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Ray Dalio, founder of Bridgewater ⁣Associates, is raising concerns about the⁢ growing U.S. national debt and its potential impact on the economy. The national debt is nearing $37 trillion,coupled with a $2‍ trillion deficit that could increase further.

dalio, appearing on FOX Business Network’s ‘The Claman Countdown,’ likened the debt to “plaque in the arteries squeezing away buying power,” warning of a possible “economic heart attack.” He emphasized the nation is “spending 40% more than we’re taking in,” creating a chronic imbalance.

To ease the economic credit crunch, dalio proposed a solution: “If we can, soon, very soon, while the economy is still good, cut the‍ deficit to 3% of GDP, ‍which is possible.” He suggested adjusting spending and tax income by 4% each, which could ⁣lead to lower interest rates. He noted a⁣ similar balance was achieved between 1991 and 1998.

However, Dalio cautioned that failure to address the debt issue would lead to “more debt ⁣and more debt⁣ service encroaching on our spending” and a potential “supply-demand problem.”

the⁤ Congressional Budget Office (CBO) estimates that President Trump’s tax bill could increase the deficit by ⁤$2.77 billion. The ‍White House has disputed the CBO’s ‍figures, ⁢arguing they don’t account for revenue from⁤ sources like tariffs. Larry Kudlow,former Trump economic advisor,has also criticized the CBO for underestimating the impact ⁣of ⁤the 2017 tax cuts.

What’s next

Congress is ⁢expected to continue working on‍ the bill,with the⁢ goal ⁣of sending it to the President ⁢by July 4.